“The Legislature reached bipartisan agreement on welfare reform recently. It’s long past time for lawmakers to come together to reform corporate welfare as well.”
Last week’s announcement that the Portland Pirates will leave Portland after more than two decades in the city was sudden and unexpected. The owner of the Pirates gave neither the city nor the state any chance to negotiate before announcing the team’s move to Springfield, Massachusetts.
All of this comes after the Portland Pirates spent the past several years wrangling with the Cumberland County Civic Center — now the Cross Insurance Arena — over lease details and after a $33 million dollar renovation completed at taxpayer expense. After the last lease negotiations, when the civic center trustees gave the team basically everything it asked for, the owner said that he wanted the team to remain here.
“I live in Maine. I want [the team] to stay here,” majority owner Ron Cain said at the time, according to the Portland Press Herald.
As it turns out, the desire only went so far.
The drop in attendance in recent years must have affected the decision-making process. It’s not easy to make money owning a minor-league sports team. The renovations and new lease apparently didn’t translate into higher attendance and profits.
That’s not entirely a surprise: the arena wasn’t the only factor affecting the Pirates’ attendance. Performance had something to do with it. The team has won only one one championship, back in its very first season in 1993-94. Over the past five years, it hasn’t made it past the first round of the playoffs. Unlike the other minor league teams in Maine, the Pirates have never been associated with a Boston team, meaning the Pirates missed out on what could have been a draw for Maine fans.
It’s hard to blame the owner of the Pirates for no longer being willing to lose money. Even minor league teams are businesses, after all, and they’re expected to be profitable. What’s less understandable is why the Pirates are being bought by an investor group from Springfield, Massachusetts — a city that just lost its own AHL team, which had lower attendance than the Pirates.
The real issue here in Maine is that local officials in the Portland area were willing to bend over backwards to accommodate a business with virtually no guarantee that the business would actually stay. With or without the Pirates as a tenant, there’s no doubt that the civic center needed improvements, but without the pressure imposed by the team’s possible departure, local officials might have made better decisions.
Rather than making renovations, Cumberland County could have designed and built a new stadium that revolved less around hockey and was more geared to other events, as Bangor did with its brand-new arena.
Nothing about this situation is unique to Cumberland County: sporting arenas are often taxpayer-subsidized. The NBA’s Milwaukee Bucks, for example, were only able to afford a new arena with state assistance. These kind of deals aren’t unique to professional sports, either. In 2010, Maine spent over $20 million buying rail lines from the Montreal, Maine & Atlantic Railway to help keep that railroad afloat; the company went bankrupt four years later anyway. More recently, the Legislature last month passed a $13 million to bailout the biomass industry that may or may not be successful.
It’s one thing to structure tax policy generally to help attract businesses, large and small, to the state or to a town. That’s smart policy, as such policies are usually geared toward helping a variety of businesses. It’s another matter entirely to spend taxpayer money fixing a facility to keep one business, or on bailouts for a specific industry or corporation. The problem is that these deals are often negotiated behind closed doors and passed at the last minute, with legislators feeling under the gun to save jobs. That’s more corporate welfare than it is smart policymaking.
The Legislature reached bipartisan agreement on welfare reform recently. It’s long past time for lawmakers to come together to reform corporate welfare as well.
This article originally appeared in the Bangor Daily News.